Can markets keep it up? After a banner 12 months for stocks, 2024 is starting on a gloomy note.
Last year ended with a rally in most assets, spurred by growing belief that the Federal Reserve is about to start cutting interest rates. Derivative markets place a high likelihood on the first cut coming as soon as March. On Wall Street, optimism abounds about the prospects for the stock market in 2024.
Markets sometimes tumble just when investors expect good times to roll on. Risks include political uncertainty caused by the presidential election, geopolitical tensions and an economic shock that drags the country into a recession.
Major stock indexes fell. The Nasdaq led the way lower, dropping about 1%, as shares in Apple and major chip companies came under pressure. The S&P 500 declined about 0.5% and the Dow industrials slipped roughly 0.2%
Oil prices ticked higher after Iranian state media said Tehran had sent a warship to the Red Sea. Brent crude futures added more than 0.5% to trade above $77 a barrel.
Bitcoin prices climbed above $45,500.
Treasury yields rose, pushing the 10-year yield toward 4%.
Japan’s yen weakened after a powerful earthquake, while its stock market was closed for a public holiday.
Chinese data showed that manufacturing activity shrank in December. Mainland shares fell.
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